Correlation Between KKR Co and PowerUp Acquisition

Can any of the company-specific risk be diversified away by investing in both KKR Co and PowerUp Acquisition at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining KKR Co and PowerUp Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KKR Co LP and PowerUp Acquisition Corp, you can compare the effects of market volatilities on KKR Co and PowerUp Acquisition and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in KKR Co with a short position of PowerUp Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of KKR Co and PowerUp Acquisition.

Diversification Opportunities for KKR Co and PowerUp Acquisition

-0.55

Correlation Coefficient

KKR Co  PowerUp Acquisition

Excellent diversification

The 3 months correlation between KKR and PowerUp is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding KKR Co LP and PowerUp Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PowerUp Acquisition Corp and KKR Co is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on KKR Co LP are associated (or correlated) with PowerUp Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PowerUp Acquisition Corp has no effect on the direction of KKR Co i.e., KKR Co and PowerUp Acquisition go up and down completely randomly.

Pair Corralation between KKR Co and PowerUp Acquisition

Considering the 90-day investment horizon KKR Co LP is expected to under-perform the PowerUp Acquisition. But the stock apears to be less risky and, when comparing its historical volatility, KKR Co LP is 1.63 times less risky than PowerUp Acquisition. The stock trades about -0.12 of its potential returns per unit of risk. The PowerUp Acquisition Corp is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest  1,200  in PowerUp Acquisition Corp on December 19, 2024 and sell it today you would lose (40.00) from holding PowerUp Acquisition Corp or give up 3.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	69.49%
Values	Daily Returns

KKR Co LP  vs.  PowerUp Acquisition Corp

KKR Co LP

Risk-Adjusted Performance

Very Weak

Over the last 90 days KKR Co LP has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's forward-looking signals remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

PowerUp Acquisition Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days PowerUp Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, PowerUp Acquisition is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with KKR Co and PowerUp Acquisition

The main advantage of trading using opposite KKR Co and PowerUp Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KKR Co position performs unexpectedly, PowerUp Acquisition can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in PowerUp Acquisition will offset losses from the drop in PowerUp Acquisition's long position.

The idea behind KKR Co LP and PowerUp Acquisition Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.